The price rationing mechanism of a freely functioning market leads to the most efficient use of resources because
A) all gains from mutually beneficial trade are captured.
B) the government regulates the market.
C) of the rise of the legislative apparatus that supports trade.
D) the Supreme Court determines market activities.
Answer: A
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Of the following choices, which is the best example of a nation's economic infrastructure?
a. Natural resources. b. Highway system. c. Government. d. Religious and cultural beliefs. e. Population growth rate.
According to new Keynesian economics:
a. the aggregate supply curve is horizontal at relatively low levels of real GDP and becomes negatively sloped, as more and more industries reach their full capacity level of output. b. the aggregate supply curve is negatively sloped at relatively low levels of real GDP and becomes horizontal, as more and more industries reach their full capacity level of output. c. the aggregate supply curve is horizontal at relatively low levels of real GDP and becomes positively sloped, as more and more industries reach their full capacity level of output. d. the aggregate supply curve is positively sloped at relatively low levels of real GDP and becomes horizontal, as more and more industries reach their full capacity level of output. e. the aggregate supply curve is positively sloped at relatively low levels of real GDP and becomes negatively sloped, as more and more industries reach their full capacity level of output.
Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
Refer to the information for this hypothetical economy provided in Table 20.2 below to answer the question(s) that follow.Table 20.2 2014 2015 2016QuarterIIIIIIIVIIIIIIIVIIIIIIIVOutput98949010210510811010397949090Refer to Table 20.2. In this economy, an expansion existed around the
A. third quarter of 2014 to the third quarter of 2015. B. first quarter of 2016 to the fourth quarter of 2016. C. fourth quarter of 2014 to the fourth quarter of 2015. D. first quarter of 2015 to the first quarter of 2016.